Question

2. Pete Jones is adding a fireplace to his home in Boston at a cost of $3,350. Contractors tell him adding the fireplace will return him a 38 percent gain on his investment. By what amount should the value of his home increase?

Answer 1

Ok, so here is how I understand the question.

Pete invests $3,350 in building the fireplace. He is promised a 38% gain, which is 0.38 * 3,350 (= 1273). Therefore, the house should increase in value by $1273.

Seems a bit simple, so I might've misundertood the question. Hope it helps :)